Cafe Hayek: Who is We?

« A Deficit of Understanding | Main | The Intangible Wealth of Nations» Don Boudreaux

December 19, 2005

Who is We?

Don Boudreaux

Commenting on this blog-post, Barry Ritholtz argues that

While it may not involve indebtedness, the obvious parallels [of a trade deficit to debt] are to spending more than you earn. In the case of the US, we now consume much more than we produce.

I disagree. The reason is that there's a fundamental confusion over who the 'we' are.

Trade makes the relevant economic 'we' larger than the population of people living within any one political jurisdiction (say, the United States). When someone in Boston or Bakersfield refrains from spending his income on current consumption in order to build a business with that income, pundits applaud. Someone -- in this case an American -- who had a claim on resources that he could have used for current consumption instead refrained from consuming in order to invest these resources in a wealth-producing asset. Because this investor is an American, his investment is counted as an 'American' investment.

But when a foreigner does the same thing, pundits get hot and bothered and lathered in anxiety. But why? The foreigner could have used his claim on resources to fund his current consumption; instead he used it to invest in an asset. What possible difference can it make to me (an American) if a stranger in Boston or Bakersfield makes such an investment, or if a stranger in Kyoto or Kiev does so?

More importantly, when the foreigner makes such an investment, he becomes in an economically relevant way one of 'we.' He is part of our economy. What does it matter that his passport is issued by another government or that he lives across the ocean? The number of 'us' in the economy expands -- and 'we' are thereby made wealthier.

No less than when investment is done by people holding U.S. passports, when foreigners invest in the U.S. there is more investment in the U.S. The fact that title to this particular investment is held by someone living abroad and perhaps not even speaking English and unable to locate Kansas City on a map of the U.S. is irrelevant.

Posted by Don Boudreaux in Myths and Fallacies, Trade | Permalink

TrackBack

TrackBack URL for this entry:
http://www.typepad.com/t/trackback/23120/3882074

Listed below are links to weblogs that reference Who is We?:

» Tuesday's Daily News from The Club for Growth Blog
Time for a Supply-Side Revival - Jack Kemp, Townhall.com Some (Belated) Fiscal Restraint - Washington Times Editorial Canadian Health-Care is No Paradise - Anthony Dick, NRO Who is We? - Don Boudreaux, Cafe Hayek Who Benefits From Fair Tr... [Read More]

Tracked on Dec 20, 2005 10:30:15 AM

Tracked on Dec 20, 2005 10:35:56 AM

» A Trade Deficit is Not a Debt from Coyote Blog
Well, the US trade deficit is up again, and you can be sure the news was accompanied by a lot of moaning and groaning and soul-searching. The main reason that all the media and the majority of Americans freak out [Read More]

Tracked on Dec 20, 2005 1:39:03 PM

» A Trade Deficit is Not a Debt (Nor is it Bad) from Coyote Blog
Well, the US trade deficit is up again, and you can be sure the news was accompanied by a lot of moaning and groaning and soul-searching. The main reason that all the media and the majority of Americans freak out [Read More]

Tracked on Dec 20, 2005 1:50:12 PM

» A Trade Deficit is Not a Debt (Nor is it Bad) from Coyote Blog
After you finish this post, I have an updated post on the same topic here. Well, the US trade deficit is up again, and you can be sure the news was accompanied by a lot of moaning and groaning and [Read More]

Tracked on Apr 22, 2006 2:23:18 AM

Comments

I always thought it was a different problemm that Trade deficit marks?

If you have more import than export, aren't you shipping out more wealth than you get into the country? I have almost no knowledge about deeper economics (except the basics) and so don't know whether I am mistaken.

Posted by: Max | Dec 19, 2005 3:38:39 PM

Don, I understand that foreign investment in our plants and buildings is positive for the U.S. economy. I also realize that purchases of our debt indicates foreigners' confidence in the stability of our economy and our government. I don't see any harm so far from a capital account surplus.

I've read that Asian governments allow us to continue enjoy their inexpensive goods by propping up our dollar. I'm nervous about that. Not the inexpensive goods part, but the part I've seen described as Asian currency intervention.

What scares me is that Asian CBs seem to be financing our government budget deficit. I believe that nearly every government expenditure is an inefficient use of funds - sometimes necesary, but usually not. If Asia continues to buy our government debt, doesn't that just make it easier for Congress to continue spending more than it takes in? Is that something I should lose sleep over?

Posted by: JohnDewey | Dec 19, 2005 4:21:01 PM

John,

Re; "If Asia continues to buy our government debt, doesn't that just make it easier for Congress to continue spending more than it takes in?"

I've had the same thought. But I'm not worried. The investors think they are investing in the ability of the US government to tax its citizens. In a way they are. But closer to the truth is that they are investing in the willingness of US citizens to pay taxes. It isn't the taxpayers who need to be worried about US government spending - at some point, we will just say no. The investors, on the other hand...

Posted by: Randy | Dec 19, 2005 5:15:25 PM

I think you have made some fundamental points here. The real key is to forget about thinking about national markets. As Tom Friedman suggested in The World is Flat - there are no American jobs only jobs. Ditto for products.

The one potential worry is whether the continued productive capacity of the US - which is brought about in part because of our economic system (which is increasingly getting weighed down by regulation) and in part because of our societal investment in science research and in educating people with science and math skills (which at least according to the OECD is declining) - will continue.

Posted by: Drtaxsacto | Dec 19, 2005 6:18:02 PM

As much as I appreciate the "no borders" perspective, I'm not so sure that all "nationalism" is a bad thing. Is it wrong (from a Libertarian perspective) to be proud of your country? Or have we "evolved" (And I use that term *extremely* loosely) to such a state of uninhibited materialism where nothing matters except the Darwinian approach to all things economic?

That's been one of my biggest problems accepting the Mises/Hayek view of the world: Darwinian Economics. It's all for ME and to hell with everyone else. There's no room in the Libertarian world for anything except a fundamental sense of selfishness, navel-gazing and loathing of your fellow man.

There's an awful lot of time and electrons spent talking about how "a job is a job", and America doesn't matter, and how wonderful Chinese products are. I sincerely wonder why people of such ilk hang around here. There are flights each and every day from JFK to Beijing. If the grass is so much greener there.....go get you some.

I'm all for personal liberty, I'm all for the satisfaction of my own wants and needs (and those of my family), but I'm not so sure that Darwinian Libertarianism is the answer.

Your entire premise that "we" doesn't matter seems to smack of intellectual hubris. "We" have to share this territory, this government and these laws. "They" don't. You may attempt to be clever and attempt to equivalence a shopkeeper in Bangalore or Bombay with one in Boston, but that's disingenuous. While we *may* be better off with goods and services manufactured/provided more cheaply in or from India and China - not ALL of us are better off all the time.

Darwinian Economics (aka Libertarianism) makes pretence at having an interest in the individual, yet is quite happy to forego the interests of the individual in favor of the masses. Which perspective you see, in any given treatise, is the one that best suits the points the author wishes to convey. However, that two-faced approach smacks of intellectual dishonesty. Short shrift is given to the pain of the few when the Libertarian perceives it is to the benefit of the many. However, when it comes to the "Liberty" perspective, the Libertarian espouses the individual over the group.

While much of what's published here is of value and has merit, there's an awful lot of intellectual arrogance that's incredibly offputting.

Posted by: Faultolerant | Dec 19, 2005 6:34:02 PM

Libertarianism doesn't say "it's all for ME and to hell with everyone else." In fact, I think most libertarians concede that we have evolved to a point in which man is altruistic (being altrustic enhances are chance of survival). The point of libertarianism is that the wants and needs of the masses are so diverse that it would be impossible for government to meet them. (So we let markets and individual altruism solve them)

Posted by: wt | Dec 19, 2005 7:23:42 PM

WT,

I agree wholeheartedly and unreservedly that Government cannot, is unsuited to, and would be undesireable for the purpose of satisfying the diverse wants and needs of "the people". That's not to say, however, that "the market" is the only solution either. Let's face it, "the market" is a survival-of-the-fittest place. It's Darwinism on an economic scale, with "death" (figuratively and, often, literally) to those who fail.

The Libertarian approach, when viewed not as an adherent but as a novitiate, is entirely targeted at what "I" can get out of it, and nothing more. The philosophy that each economic actor acts in his/her own best interests and that society happens to benefit is a perfect example. There is no place in the Lib world for anything other than hardcore, self-centered narcissistic egotism.

Libs espouse a philosophy of disdain and even outright loathing for the country that permits/supports their perspective, casts aspersions on those of us who have served it (this website is no exception), and pokes fun at anyone who is concerned for the deindustrialization of America, cares about America's poor and disenfranchised, and (in many instances) for any discussion of faith, beliefs or morality.

If it's not in the consumer's best economic perspective - and made in China - it's a "bad" in the Lib world. (As an aside, I'm also amazed at how concerned Lib's are with the poor in China and India but how little the Libs care for poor Americans. Isn't this a bit myopic and hypocritical?)

While markets can be very efficient in many ways, and are much better than central planning, I simply can't agree with the Lib perspective that they're the answer to every ill. Furthermore, I'll argue till the cows come home (to be slaughtered for beef to sell at Wal-Mart....Lib nirvana) that the "point" of Libertarianism is for an "evolved" man to do anything except consume for the sake of consumption and all else be damned.

Lastly, the whole hoary canard that Lib mouthpieces like Rockwell, et al. sputter about "liberty-&-freedom" is utter tripe. To Rockwell&Co "liberty" and "freedom" are naught more than Orwellian double-speak for yet another set of rules that invest power with business and markets and deinvest it from governments and planners. Rockwell&Co are no better than FDR and no worse than Chavez. Tyranny from government is no better or worse than tyranny from big business. Frothing at the mouth and declaring it to be untrue doesn't change a thing.

I would, however, love for your perspective to be true: that mankind HAS evolved enough for genuine altruism to be a deciding factor. My assertion is that the Lib perspective is bankrupt in this area. Yes, the Lib pro-anarchy, anti-government stance is worth discussing, but all to often taken to absurd extremes.

Posted by: Faultolerant | Dec 19, 2005 8:10:45 PM

When interest rates rise bonds fall. Or is it that when bonds fall interest rates rise? Doh!

That about covers the discussion. Of course Congress can spend more when foreigners will eagerly buy treasury bonds. Try this:

Go to your neighbors house and ask him to loan you a million. If he does I guarantee you can buy that Bentley. Next year have him buy you a winery in Napa. Give him an new IOU when the first one is due.

True, the US spends more for imported goods than foreigners spend for our exported goods. That is not the same as whether we consume more than we produce.

What we produce includes homes and other plant that stay here. And most Americans are very happy to have nice quarters.

So what actually happens? The trade deficit raises the price of goods that both foreigners and Americans want - a house in Newport Beach, shoes, a million shares of GE, or, yes, a billion in treasuries, for examples. The price is higher because the foreigner has money to bid against the American.

Ultimately it is government judgement that should concern us and not personal purchases. Individuals make only lenders unhappy by going broke. Governments make everyone miserable.

Posted by: K | Dec 19, 2005 8:27:27 PM

To Max: No, a trade deficit doesn't mean you're shipping out more wealth than you take in. Consider: are you running a trade deficit with your local supermarket? (Most of us do, unless we work for the supermarket.) If so, are you worse off? Are you poorer because of it? Would you be better off if you grew and raised all your own food?

To "Faultolerant": Boy, you live in a rich fantasy world, don't you?

Posted by: asg | Dec 19, 2005 9:07:42 PM

In the case of the US, we now consume much more than we produce.

Can someone please help my simple brain to believe that ststement?

We produce about $12 trillion a year in the US (I know -- give or take.) Of that $12 trillion, we sell a fraction of our production abroad and buy a somewhat larger fraction from the same. But does that really equate to consuming more than we produce?

It seems to me that a portion of the incredible wealth that we generate by buying and selling to ourselves (the domestic economy) can be spent in other countries (even with the trade "deficit") without turning us into a debtor nation as is the current stylish term.

As a lay-economist, what part have I got wrong?

Posted by: Craig | Dec 19, 2005 9:14:52 PM

I think a key point is struck upon when it is said. "The number of 'us' in the economy expands -- and 'we' are thereby made wealthier."
The number of "us" is critical. Many people see more of "us" equalling less for "me". Not so. This world is not lacking in resources. What is lacking is the human energy to go put those resources to use. Even the resources we have already "used" are still present in one form or another, 2nd law of thermodynamics says so.
Why did farmers have so many kids? To work the land. Wouldn't that mean less food for each new mouth? No! For every mouth there are two hands!
To relate this back to the post, when foreigners invest in our economy, they send their hands but not their mouths! Trade makes everyone wealthier.
The more the merrier, I say. The key is the law (not government) and whether an environment conducive to investment and trade is present. Are contracts protected and torts enforced? Keep it that simple, and everyone gets rich. Period.
www.jurisnaturalist.blogspot.com

Posted by: Nathanael Snow | Dec 19, 2005 10:36:12 PM

Funny choice of cities.

I grew up in Bakersfield and live in Boston.

All you have to do to stop worrying about trade deficits is look at times in history when we ran a deficit or surplus. The former is almost always during times of growth, and the latter during times of recession.

I think people worry about this because news of red-ink and doom-n-gloom sells.

Posted by: Ivan Kirigin | Dec 19, 2005 11:04:11 PM

Faultolerant, if you love America so much, why do you want to use FORCE to prevent your fellow Americans from trading with whom they wish? The use of VIOLENCE against your fellow man is the only alternative to free trade.

Under free trade, you are free to boycott Chinese goods, and I am free to by them. Under protectionism, you are still free and I am not. How is this good for the nation?

Posted by: Noah Yetter | Dec 19, 2005 11:40:38 PM

What possible difference can it make to me (an American) if a stranger in Boston or Bakersfield makes such an investment, or if a stranger in Kyoto or Kiev does so?

Is there a reductio ad absurdum argument to be made here? What happens if eventually every U.S. business, every house, all the government debt, is bought up by foriegners, and the U.S. sellers use the money they get for consumption?

The point about investment is that it yields future income. If you sell off assets (or borrow) to finance current consumption, that comes at the cost of future consumption.

It's all very well saying forget about national boundaries - very well then, say one group of people sell off their assets to (or borrow from) another group of people? That might be fine and dandy if the sellers (or borrowers) re-invest, but if that money goes on consumption, sooner or later those people are going to run into trouble (and find themselves beholden the other people, who own the assets and the debt).

There's nothing in this story about nationalities - never mind 'us', 'them' and 'we' - you can cut the population of this planet any which way you care to, but isn't the deficit an indicator that one group of people (as it happens, Americans) are selling assets / borrowing from another group of people to finance consumption? Now that might be OK up to a point (there are I imagine ways in which it could be sustainable) but surely sooner or later (as we approach the point where every US asset has been sold) it becomes a problem for that group of people?

Posted by: Paddy Carter | Dec 20, 2005 3:41:38 AM

Does this mean that a country which exports more than it imports (like Germany), may not be that healthy market-wise, because we can't derive functioning markets and job-creation from high exports rates?

Posted by: Max | Dec 20, 2005 4:28:29 AM

I don't see how foreign investment in the U.S. can be bad for our economy. When TXU issues debt and uses the proceeds to expand its generating capacity, what difference does it make whether foreigners buy some of that debt? When a refinery is expanded in Texas, what difference does it make whether BP or ExxonMobil owns the refinery? When BMW built a plant in South Carolina and employed thousands of American workers, how did that hurt the U.S. economy in either the short term or the long term?

The argument that we're selling off our assets to finance consumption seems to assume that the total amount of U.S. assets is fixed. That's just not correct.

Posted by: JohnDewey | Dec 20, 2005 4:50:35 AM

John,

you may be right - I was just thinking aloud really.

However, I don't see that my argument assumes that the total amount of U.S. assets is fixed. As I said, there is scope for re-investment in new assets, or for consumption. Accepting that the total amount of U.S. assets is not fixed, a "net sell off" is still a possibility, isn't it? I guess that just means the rate of sale is greater than the rate of accumulation.

Posted by: Paddy Carter | Dec 20, 2005 5:39:51 AM

A further thought, which might be a red herring - is a foriegner buying a US company the same as a forigner setting up a new company in the US (or funding expansion, whatever)? A change of ownership does not necessarily mean that the level of ongoing investment in that busines will be any higher than it would have been under domestic control.

I think, though, that I may have got the wrong end of the stick (always a danger for non-economists). Deficts are not all about investment and consumption after all - changing productivity rates need to be added to the equation, for a start. But, while it may be that case that large deficits are not necessarily the problem people take them to be, I'm not sure that amounts to deficits being nothing to worry about, which is what Don seems to be arguing.

Posted by: Paddy Carter | Dec 20, 2005 5:48:01 AM

Paddy,

I enjoy this blog, but I'm not an economist, either. Even if I were, there's no guarantee I would have the right answers. Menzie Chinn and other bright economists share your concerne about the growth in the current account deficit. Menzie argues that both the fiscal deficit and the current account deficit are not sustainable. I've been wading through his special report, "Getting Serious about the Twin Deficits". Here's the link:

www.wisc.edu/wage/pubs/Twin_DeficitsTF.pdf

Posted by: JohnDewey | Dec 20, 2005 7:21:31 AM

Max: Yes, a country running a trade surplus can be economically unhealthy, but it's probably not because of the trade surplus. Part of the fallacy Don and the others on this blog are talking about is the idea that economic health or lack of health is tied to the balance of trade. Just like, in the analogy I gave before, you can't tell how productive or wealthy someone is just from looking at how much he or she shops at the grocery store.

Posted by: asg | Dec 20, 2005 11:07:32 AM

K:
I challenge you to prove where anything I said is fantasy. Put your money where your mouth is.

Ivan:
Read what I actually SAID and not what you want to read. Nowhere did I say that we should use force against anyone. Ever. Period. That's YOUR interpretation and it's wrong. You are, indeed, free to buy whatever you want. I've never argued against it. I did, however, say the Lib perspective on this (and many other issues) is inherently dishonest. If you want to discuss that, fine, but don't attempt to attribute your words to me.

Posted by: faultolerant | Dec 20, 2005 11:18:45 AM

faultolerant,

As you said, "while markets can be very efficient in many ways, and are much better than central planning, I simply can't agree with the Lib perspective that they're the answer to every ill."

While you never explicitly say that force should be used, if you don't believe that free markets are the answer to every ill, then one can only infer that you believe where the free market fails the use of force (through taxation, forced trade, etc) must be the solution.

Besides, I think you've constructed a few straw man arguments about libertarians and their beliefs in the free market. I'm not such a "hardcore, self-centered narcissistic" to believe I speak for all libertarians, but I've never believed that free markets help everyone all the time. Obviously when technology displaces workers it creates hardships for some people. Obviously when one retailer outcompetes another it may cause those businesses to close.

At the same time, I'm not willing to trade one tyrant in the form of central planning governments for another tyrant of big business. Free markets are about voluntary mutually beneficial trade not about building a bigger Corporate America (or whatever country people live in).

Posted by: Scott | Dec 20, 2005 12:55:02 PM

The dirty little secret is that although trade may make the US better off in the aggregate, many Americans are much worse off as individuals.

Economists don't want to discuss this, and my fellow conservatives have drunk down the purple Kool-aid of Bush cronyism in place of market capitalism.

The backlash is coming.

Posted by: save_the_rustbelt | Dec 20, 2005 4:16:13 PM

save_the_rustbelt, how is that a dirty little secret? I know of no free market capitalists that would argue that it makes everyone better off all the time.

Capitalism, socialism, whatever "ism" you believe, there will always be winners and losers as no system is perfect. As a society we need to get past this thinking that there is some magical economic model that makes everyone better off all the time.

The question then should be, which does the least harm. Is it preferable to have a system where society is better off in the aggregate with many individuals much worse off OR one in which society is at an overall lower standard of living, but there is little to no gap between the rich and the poor?

Posted by: Scott | Dec 20, 2005 4:53:46 PM

My turn to jump into this fray...

Save-the-rustbelt wrote:

"The dirty little secret is that although trade may make the US better off in the aggregate, many Americans are much worse off as individuals."

First of all, that's not a secret, but, happily, it's not dirty either. Think about what you wrote (my paraphrase): Trade has made most of us better off, even while some of us are worse off.

Now, consider this example. Suppose you're a member of the United Typewriter Manufacturer's (UTM) union. You and yours are getting exercised about these new computerized word processors. Your union begins to put enormous political pressure on the local politicians, one of whom is an influential congressman. He manages to pass the "Typewriter Protection Act," which effectively kills the nascient computer industry. You and your union buddies continue, for a time at least, to make oversized pay for your undersized skills, while the rest of America is punished for your greed.

Silly example? I think not. Consider any innovation of the 20th Century (or any time) that hasn't destroyed a FEW jobs to benefit the MANY. This is the "creative destruction" that Schumpeter (I think it was him) wrote of technology.

The point is that our economy is constantly reinventing itself and, anytime we interfere with that reinvention, through socialist price or labor controls, we hurt the many for the few.

Oh, and to "Faultolerant": The onus is on you is to "come up with a better system." Your posts indicate a real confusion; you're trying to have the benefits of free markets, but moderated by....what, exactly? If not Government, then what?

Also, you really should read Hayek's "Road to Serfdom." Your understanding of Libertarianism (and his is the only Libertarianism that's intellectually coherent) is seriously flawed.

Posted by: JABBER | Dec 20, 2005 5:02:14 PM

Scott, you beat me to it. Well said!

Posted by: JABBER | Dec 20, 2005 5:03:29 PM

Jabber,

Thanks for the reference to "Road to Serfdom" - I shall make it a point to read it. I am glad that someone recognizes that the overall Lib perspective IS, indeed, incoherent. I prefer to call it bankrupt.

In all honesty, I don't have a better system. I'm muddling through just like everyone else. Certainly it's painfully obvious that the Dem/Rep view of the world is seriously flawed. However, that doesn't make nirvana out of the Lib way.

Back to an earlier point, it's almost amazing how many visitors to this board are willing to "sacrifice" others (notice that no one here has offered to voluntarily give up THEIR job - as if though it were possible) on the alter of Darwinian Economics. The "Lib Way" touts the individual (out of one mouth) and then happily slaughters said individual in favor of "the masses". Isn't it a bit hypocritical to espouse one perspective until it's inconvenient and then espouse another? We're not talking about an epiphany of change - we're talking about swapping horses in the same paragraph....almost in the same sentence.

As far as my understanding being flawed, well, you're certainly entitled to your own worldview. Berating me doesn't change the fundamental nature of Libs and how intellectually corrupt the whole thing is.

How about showing me where I'm wrong:
1. Lib's worship at the altar of Darwinian Economics;
2. The individual is important in discussions of "freedom", but is happily thrown overboard in favor of the masses;
3. Libs, in general, are incredibly confused on most major issues of our day: Immigration, the Rule of Law, Government (that is to say Lib's all vomit hatred for any organized control, but yet haven't come up with anything better - and save the "Market Governs" canard...that puppy don't hunt);
4. Lib nirvana is Wal-Mart;
5. Lib's, again in general, are inhospitable to any view which doesn't conform, but pay false homage to nonconformism;
6. The Lib world is one of "ME FIRST" and everyone else second;
7. Much to the chagrin of the Lib Way, the whole world doesn't revolve around how much cheap crap we can buy from China or how many idiots can answer calls in India.

I'll admit that I'm throughly disenchanted with how the current powers-that-be have mucked things up. As a dyed-in-the-wool conservative (Note, that's NOT Republican), I'm dismayed and dissatisfied with where this country is going. I had great hopes that Libertarianism was an alternative that respected the individual, favored advancement for everyone and had as much "heart" as "brains". It's painfully apparent that I won't find that here. The whole narcissistic intellectual chauvanism encountered to date doesn't give me a lot of hope. Thus far my readings have been limited to von Mises & Rand (soon to expand to Hayek), but I sincerely doubt that I'll find anything worth a warm bucket of spit there either.

Posted by: faultolerant | Dec 20, 2005 6:49:31 PM

faultolerant,

I make no claims to speak for any/all libertarians, but here's one libertarian/free-market capitalists response to your questions:

1. Without knowing what your definition of Darwinian Economics is, it's hard to respond. If you mean simply, "survival of the fittest", then yes as a libertarian I believe that's where progress comes from. Technological change makes some labour skills irrelevant. In other words, Schumpeter's creative destruction.

2. As a libertarian I believe, the individual is the highest form of sovereignty and that any obligation to another group or individual is a violation of the most basic of individual rights. This means that no one, governments included, has any claim over me, the output of my labour or private property I have freely acquired.

Further to this, to claim that individuals are "thrown overboard in favor of the masses" is essentially stating that people are gauranteed a place in life. This however, violates my freedom to trade freely with other individuals. If I am forced to support someone because their job is becoming obsolete then that is essentially saying that person has a claim on my freedoms.

3. You are correct in that libertarians, like members of any political leaning, have varied opinions. Howver, I believe much of that has to do with trying to fit libertarian ideaology in a non-libertarian world. Issues like taxation and social support muddy issues like immigration.

However, rule of law is generally agreed upon. I believe, the only moral function of a government is to ensure that individuals freedoms and rights are protected from the initiation of force by others. This includes a legal system to prosecute violators, local police to provide local protection and a national army to protect against foreign invaders.

4. I would go so far as to say that Wal-Mart is a libertarian nirvana, but it's more of a symbol of free market capitalism that libs have been forced to defend. When other groups use Wal-Mart as a symbol of what's wrong with free markets, it's only natural that defenders of free markets are going to argue the opposite.

5. Is any ideaology completely accepting of opposing views? If one believes in something, does it not make sense that they think it's right and that opposing views are wrong?

6. Yes, I agree, see answer 2. That's not to say that libs believe in a "to hell with everyone else" mentality. Don't confuse short term benefits with long term benefits, sure people might be better in the short run by taking advantage of another, but in the long run that kind of thinking is detrimental and many libs believe in co-operation. In fact, without co-operation there wouldn't be one of our most basic beliefs, voluntary mutually beneficial free trade.

7. Materialism and consumerism have nothing to do with libertarianism. It's not about "how much cheap crap" libs can get, it's about the fact that we are "free" to engage in that trade. It's about the mechanism of free trade rather than the accumulation of goods.

Posted by: Scott | Dec 20, 2005 7:44:52 PM

Faultolerant, I think that Scott has pretty much nailed it, and I especially like his last point, namely that materialism and consumerism have nothing to do with libertarianism, except, perhaps, that they spring from it. The essential point is that the individual is free to choose his or her own destiny, so long as the choice is acceptable according to the Rule of Law. Libertarians sometimes are accused of being anarchists and, no doubt, some may be, but Hayek, for one, made a huge deal out of the Rule of Law. His main beef with the legal system was that it's capricious and too subject to being changed after the fact. For example, he would have been apoplectic at suggestions of a "windfall profits tax," as he would have seen it as changing the rules in the middle of the game. Such a state is nothing if not the bastion of special interest politics (ie, where I win and you lose, or vice versa).

Perhaps the essential point of heartburn for you and for many against Libertarianism is that it seems to be amoral, that it seems to embrace a Darwinian view of economics. Again, no doubt, there are some who feel this way. My own "moderated" view is that a truly fair Libertarian system must have an equal playing field. Most of this is covered by a strong Rule of Law. Some of it would include education for all, regardless of class and according strictly to merit. It might even include transfer payments for those who suffer severe want through no fault of their own (ie, handicaps and/or disability). This probably would get me thrown out of most Libertarian conclaves, but I think that it's part and parcel of a civilized society.

That said, we should EXPECT able-bodied people to pull their weight, or, if they choose not to, they shouldn't bellyache about how oppressed they are. It's all about the choices we make; ie, we have to be responsible for our actions.

Posted by: JABBER | Dec 20, 2005 8:55:55 PM

Jabber, I agree, libertarianism and altruism aren't mutually exclusive. Many libs believe in helping out others, through charity and other voluntary means. Where some libs differ is to what extent, if any, should people be forced to support others. Personally, I believe completely voluntary charity builds a stronger society as there is greater interaction between the "rich" and the "poor". People have to work harder to build a "safety net" including building stronger bonds with family, friends and members of your local community. With the current social system there is a disconnect between those giving and those receiving.

Posted by: Scott | Dec 20, 2005 10:10:41 PM

faultolerant seems upset with me (K) about fantasy.

I think he meant to argue with asq (see 9:07;42 pm post of last night.)

Nothing I wrote mentioned fantasy, said he was wrong, or was about libertarians and darwinians. With or w/o captital L and D.

Posted by: K | Dec 21, 2005 12:55:30 AM

K - please accept my apologies if I have misidentified you. My point was indeed for "asq". Sorry!

Jabber & Scott, first, thanks for your thoughtful responses - they're much appreciated.

I'm beginning to more finely identify where I have "heartburn" (good term, BTW) with the Lib philosophy:

On one hand the bedrock of Lib-ism is "the individual". That's all great and fine, and is trumpeted violently whenever and wherever possible. I'm all for each of us doing well, and continuing to do better. However, not everyone is capable of success (in the materialistic definition of the Lib-way). Most Lib "scholars" (and I use that term loosely) are quite happy to consign anyone who doesn't measure-up to some sort of biological scrap-heap. I genuinely perceive that if Libs were in power, we'd be practicing Euthanasia against an awful lot of "lesser" humans. I simply cannot accept any philosophical perspective that has no room for care and consideration of your fellow man. (Do Libs kill their elderly when they run out of money?)

The philosophy that the able-bodied must support themselves is, I believe, an axiom. Furthermore, I've not read one single word that would convince me that Lib-ism is NOT the ultimate consumerism, me-first, selfish, money-centric, materialistec, amoral perspective the planet has ever seen.

I'm also repulsed by this entire perspective that "I" is the only important economic actor. Libs are quite happy to sup and the trough of sacrifice by others and then turn around and denigrate them for their suffering. Let's face it, if Libs had been in power for the last, oh, 75 years, there would be an awful lot of people in France speaking German. (As an aside, is cowardice a Lib trait, or just amongst the biggest Lib mouthpieces?) I'm also amazed at how "concerned" Libs are with providing jobs to Chinese, Indian and Pakistani laborers and are almost gleeful when GM lays of 25,000 people here.

I'm not suggesting that we all have to bow at the alter of US supremacy, but would a little gratitute and appreciation kill y'all? Yeah, I've heard the arguments: cops and soldiers get paid to do their stuff and that's all they deserve. It's just an awfully coldhearted perspective and one that reeks of an amoral mongrel belief system. Of course, if that's the goal, then the Lib perspective seems to have it all sewn up.

When it comes to economics, there's much to be admired: Permitting free trade, which is beneficial to all participants, is an amazing and wonderful thing. However, Libs scream like banshees against taxes, yet whine that Government should "protect their rights". There's an awful lot of lip-homage paid to "the rule of law" and no understanding that to enforce those rules someone has to be paid to do that dirty work.

I seem to notice that in this LibNirvana there is no crime and everyone plays by the rules. However, in reality we can't even agree on what the rules are, much less get everyone to sing from the same hymnal.

Another glaring inconsistency is how Libs depend on the government for many, many things yet act like a bunch of children when told they have to pay for it. Take, for example, the FDA. Is there a single Lib out there who can make an intellectually valid argument that our drugs would be better if the FDA were to stop enforcing safety rules? The next time you're wandering through the grocery store and look at the nutritional information on the back of that can of soup can you say that it would be better if you didn't know what was inside? That it would be better if the soup company could use horsemeat and call it beef soup?

Yeah, I'll agree that for every inch of legitimate power invested in government they've gone about three feet - but that doesn't obviate the need for it. It means we need to cut it back like an overgrown bush, not yank it out by the roots.

Honestly, I think I'm so seriously confused about Libertarianism because it seems to denegrate so many things I hold dear, yet makes many vital points that are too important to ignore.

One last point: I've been having an argument with a Lib friend about my car buying habits. I buy new cars about every six months - drive them for a few thousand miles - and get another one. The last 5 have been Cadillacs and the last 21 have been all American (Ford or GM). (One German car which was a disaster).

My friend says I'm supporting what should be a dying industry, that American autoworkers deserve to be unemployed, and that I should only buy the "best" car - regardless of where it was made or by whom.

Now don't get me wrong, my Caddies have been fantastic cars and I'll be happy to put them side by side with anything from Germany or Japan. (Read the automotive press and you'll see they're some fine vehicles). However, I'm being told that my actions are actually detrimental to the US auto industry and that I should be buying the best of breed (within my affordability range) and nothing more. Am I actually "harming" (economically speaking) someone by buying a car because it was made in Detroit or St.Louis as opposed to one made in Seoul or Yokohama?

Just want to get someone elses $.02.

Thanks muchly!

Posted by: Faultolerant | Dec 21, 2005 7:37:03 PM

Faultolerant -

I think you're pointing out a lot of the reasons why libertarianism is such a fractured movement, and why many people who hold mostly libertarian beliefs don't identify themselves as such.

Personally, I see two sides of the libertarian coin. On one, there is Ayn Rand's objectivism, which is what you seem to be reacting to. I'm actually with you in believing that it goes too far in atomizing people.

On the other side, you have Hayek, who realizes that, like it or not, we are part of a society and that we should act within that framework to create one that allows people to be in the best position for personal prosperity, which is a society of free individuals and free markets made possible by the consistent rule of law. To that end, I personally hold soldiers and most police in high regard because they help establish the rule of law.

As to your American v. foreign car argument, the beauty of a free market is that we can all buy products that suit our wants and needs. Your friend is actually wrong from the perspective of darwinian economics since the only thing that should be the arbiter of whether a company lives or dies is whether it's managing to make money. If the company is in business and it makes a car that satisfies you, then there's no reason not to buy it.

Posted by: Quincy | Dec 22, 2005 11:36:04 AM

Quincy: Thanks for your response. I'm learning an awful lot and appreciate every bit of rational explanation I can get.

Posted by: faultolerant | Dec 22, 2005 2:07:33 PM

to faultolerant

I notice you intend to read The Road To Serfdom. Follow up. That small agreeable book fearlessly drives the stake of reason through the vampire* of Socialism and Central Planning.

*not a casual simile. Central Planning must suck all freedom from the governed to exist.

Posted by: K | Dec 23, 2005 12:01:54 AM

I sell new 4wd cars at best prices.
danpop77@yahoo.com

Posted by: Dan I. Pop | Jan 30, 2006 8:33:35 PM

suck me bitch
amazinganal
amazing anal
amazinggangbangs
amazing gang bangs
analpals
anal pals
analsweeties
anal sweeties
asiantease
asian tease
boobieclub
boobie club
brownhairgirls
brown hair girls
celebhotel
celeb hotel
cigarettesluts
cigarette sluts
circuspenis
circus penis
clubheshe
club heshe
club he she
clubtitties
club titties
digitalchicks
digital chicks
dildodippers
dildo dippers
dirtyxxxsex
dirty xxx sex
dreamkelly
dream kelly
ebonycheeks
ebony cheeks
fistbang
fist bang
footcravings
foot cravings
freshauditions
fresh auditions
freshfacials
fresh facials
freshteens
fresh teens
fuckingtoons
fucking toons
gir for girl
girlforgirl
grandegirls
grande girls
hardcoretoons
hardcore toons
hotnudegranny
hot nude granny
indiauncovered
india uncovered
interracialsexfest
interracial sex fest
kinkymaturesluts
kinky mature sluts
kuntfu
kunt fu
latinasex
latina sex
lipsticklesbo
lipstick lesbo
manhunter
man hunter
miniboobs
mini boobs
perfectorgy
perfect orgy
pimp4aday
pimp 4 a day
pompomporno
pom pom porno
pregnantbang
pregnant bang
redhairsex
red hair sex
secretfetishes
secret fetishes
sheshuge
shes huge
shockingcocks
shocking cocks
slutmovies
slut movies
suckmebitch
suck me bitch
sugarmamas
sugar mamas
superbush
super bush
tabooinsertions
taboo insertions
teenbody
teen body
teenfactory
teen factory
videoseekers
video seekers

Posted by: prodigy | Jun 29, 2007 6:31:00 PM

Posted by: milfseeker | Jul 30, 2007 7:31:58 PM

Posted by: milfseeker | Aug 14, 2007 5:10:45 PM

According to recent news, the erectile dysfunction afflicted elderly people in Brazil were administered with free viagra and as a consequence they were miraculously cured of impotency. Doesn’t this news appear utterly surprising to you? But the man who is well aware of all the informa

Cafe Hayek

where orders emerge

Links

Econtalk

Blogroll

Categories

December 19, 2005

Who is We?

TrackBack

Comments